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Venezuela to maintain oil production at 3 million bpd

Venezuelan state-owned oil giant PDVSA said Thursday it plans to maintain oil production at approximately 3 million barrels per day in 2015, more than 2.5 million bpd of which is to be exported.

“Our plan in 2015 is to maintain our production and develop our ability to react to any market scenario,” PDVSA President Eulogio Del Pino said during the presentation of Venezuela’s budget to the National Assembly’s Standing Committee on Finance and Economic Development.

In statements published by state news agency AVN, Del Pino said “crude exports will amount to 2,528,000 barrels per day and the volume to be set aside for the domestic market is estimated at 766,000 barrels.”

Del Pino said the development of gas reserves, including projects in the northern state of Sucre that are expected to yield 8 billion cubic feet of gas per day, will help replace diesel as a feedstock for thermoelectric plants.

PDVSA’s decision to keep production unchanged contradicts other announcements made in recent years and would mean failing to meet a previously announced goal of doubling oil output by 2019.

In late 2013, then-PDVSA President Rafael Ramirez, currently Venezuela’s foreign minister, said the company had set a target of producing 6 million bpd in less than six years.

The government has carried out different plans aimed at increasing oil production and reaching output targets of 3.5 million bpd in 2012, 4 million bpd in 2014 and 6 million bpd in 2019. However, production remains stuck at around 3 million bpd.

Venezuela, the world’s fifth-largest crude exporter, sells around 2.5 million bpd to foreign markets, mainly the United States and China.

Oil sales account for more than 90 percent of Venezuela’s foreign currency earnings and half of the government’s budget revenues.

After falling for several weeks, the price of Venezuela’s crude basket currently stands at less than $80 a barrel, its lowest level in several years.

Venezuela has urged the Organization of the Petroleum Exporting Countries to call an extraordinary meeting to address the drop in crude prices, but other OPEC member states such as Saudi Arabia have rejected the possibility of a gathering prior to the cartel’s next scheduled meeting in late November